Tuesday 22 June 2010

Budget 2010.
Please note that this post refers to the text in the Budget document. You can get a copy here. Having that document open alongside this will help put my comments into context although the post is perfectly readable without it.

~ Initial Reaction ~

The first budget of the coalition government has arrived and my initial reaction is one of cautious optimism. Without going through every single policy decision it seems to me that business (especially new businesses) have been well catered for while looking after the poorest in society also seems to have been allowed for despite some significant cutbacks.

I fear that the Lib Dems will be disappointed with this budget. Not against it, just a bit miffed that there is only lip-service to some of the key policies that were carried through to the coalition agreement. Paragraph 1.96, regarding the modest (possibly pointless) increase in Capital Gains Tax, is (for me) a good example. That said though, there is a lot of deregulation [Paras 1.65 and 1.66] that I think will cheer them up. It certainly pleases me (though I may regret saying that!).

~ Closer Inspection ~

The decisions that relate directly to the existence (or otherwise) of public sector jobs have been put to a spending review [Para 1.38 - 1.39]. Hopefully, with the various interested parties on-board, a deal can be reached to save money while protecting as many jobs as are necessary. I would hope that, where jobs do need to go, that a little extra help is given to those people to find work. It seems fair to me that if you're sacking someone for no other reason than you can't afford to keep them, that you help them out in some way (especially if extra help can lessen the potentially massive redundancy-pay bill as part of a wider redundancy package).

To my inexperienced eyes there are a couple of interesting overtones in this budget.

Firstly, the treating of the Royal finances like that of any other government department. This, to me, implies that the government sees The Queen as an extension of it, rather than the other way round. This may have been the case before (formally, not informally) but I hadn't noticed until today. See paragraph 2.173 for details. Seems fair to me as long as there are no privacy issues (and I don't foresee any).

Secondly, there seems to be increasing recognition of England as a distinct entity - is this a prelude to action on the West Lothian Question? I cite paragraph 1.87 (a growth fund solely for England) as my flimsy shred of evidence.

I think it's good to see that the Fuel-Stabiliser idea is still being considered [para 1.121] but I would like to see more action taken against the investment banks. You know, the ones that helped get us into this mess. So I'd like to see more than just a bank levy [para 1.63]. I'd like to see state owned banks being forced to lend; which is far more than the budget proposes in paragraph 1.78 but at least it's something.

~ In Conclusion ~

Thank you to the government for producing a budget document that I could actually read and understand without my head feeling like it wanted to explode!!! Though some of the graphs and data may possibly be regarded as 'spin' the overall theme is that the poorest in this country will have to pay a lot less than the richest. Which is a good thing in my opinion.

However, the proof of the pudding is in the eating and, as some commentators have said, there is a gamble here. The private sector needs to grow and confidence needs to return to the markets. Lets hope it happens.

Monday 21 June 2010

An Appeal for Calm.
There's a lot of posturing ahead of tomorrow's Budget (mainly unions and other NIMBY's). There's a lot of speculation too. Then there's the Labour party getting wound up at the speculation and just generally shit stirring.

So I would like to ask everyone to please take a deep breath, relax, and wait for 12:30 tomorrow before going off on one.

Thank you.